That depends on how many more trillions our government spends the rest of this month propping up our economy. Without the huge government bailouts we would be at 1500 I'd bet.

Don't fight the Fed. Especially when they're spending our money/future.

CaptnCarl said:

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I really wished I would have backed the truck up on sub $60 CVX stock a few weeks ago. Anybody think we'll see it below $70 this month?

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Lots of people, in hindsight, kicking themselves for not backing the truck up on pretty much anything 3/21-24 when CVX and everything else bottomed out before bouncing back 25-30%. This isn't an XOM or CVX event.. it's a broad market event.

I still don't believe the risk in any 1 stock is smart in this environment. Why would you opt for a pistol when a shotgun will accomplish the same thing?

Except they're not the same valuations. Energy, financials, entertainment, industrials.... all had opportunities (and still do) with companies that have weathered many storms like this before and come out on the other side... trading at 40,50,60, even 70% off 52 week highs.

The broad market bottomed (so far) around 35%, and now much less than that. I love ETFs and even mutual funds, but when you have sectors of the market and strong, stable companies so severely undervalued in periods of extreme volatility, I'd take advantage.

I'll leave broad market ETF's for the time in the near future when their valuations more closely resemble the individual companies held within them

You're right. It's partly emotional and I need to stay the course. I did buy a lot of VTI around $115 that week. I also bought lots of XOM, but wish I bought CVX.

The thing about Chevron sub $60 is I feel that's about half price of what it will be in 3-4 years. I don't see VTI doubling to around $230 in that time frame.

But you're spot on. Hindsight is 20/20. Time in market beats timing the market.

ehrmantraut said:

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Except they're not the same valuations. Energy, financials, entertainment, industrials.... all had opportunities (and still do) with companies that have weathered many storms like this before and come out on the other side... trading at 40,50,60, even 70% off 52 week highs.

The broad market bottomed (so far) around 35%, and now much less than that. I love ETFs and even mutual funds, but when you have sectors of the market and strong, stable companies so severely undervalued in periods of extreme volatility, I'd take advantage.

I'll leave broad market ETF's for the time in the near future when their valuations more closely resemble the individual companies held within them

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I don't understand your last statement. ETFs don't have valuation.. they carry the valuation of the underlying investments by definition.

I follow with your logic, but my conclusion is completely opposite of yours. I buy indexes when everything is the same.. I buy individual companies when there is divergent risk/reward opportunities.

I also think it's with acknowledging there is tremendously more guesswork in determining valuations than ever before.

I think you misunderstood me. I agree with what you said here

Put in another buy order for Monday morning.

I just cashed out a large gain on mostly all oil and energy stocks on Thursday that I started buying first week of March and through the end of it. I think there will be another dive once the extent of all the Shale shut-ins ripple Throughout the industry and firms start folding, And if Russia announces a big middle finger to the rest of the world in this oil price fiasco, And demand doesn't just rocket back anytime soon. I'm keeping the money in the account and will dive back in if we have another big dip, and if we don't, oh well at least I made some bank to offset the giant sucking sound my retail business is making right now.

Hope so. I bought way low, and will hold onto it for a while. I'd like to buy more at a bigger discount

I have what may be a stupid question, but I'm fairly new to investing so please bear with me. I was thinking about buying XOM stock for the long term for my Roth IRA account this year. I thought it might be a good move since Exxon is a stable company and the dividends would not be taxed in my Roth account. Would this be a wise thing to do or foolish?

I think it's a great idea. Supposedly the tax advantaged accounts like the Roth IRA are you hold your riskier investments. This would could as high risk.

If the roth is your only savings/investment accounts, I would do like 60% ETF, then 40% the XOM.

Tax-advantaged accounts are a great place to hold income producing securities (interest and dividends) and XOM certainly fits the bill. Go dividends reinvested too.

I know you said "long term" but a lot really depends on your goal and your marginal tax rate. At the end of the day if I'm in a really low tax bracket then I'm not overly concerned to pay taxes on some of my investments particularly if I might have a need or desire to use those in the near future (ie spend the dividends, or liquidate the stock).

Drifter. said:

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I have what may be a stupid question, but I'm fairly new to investing so please bear with me. I was thinking about buying XOM stock for the long term for my Roth IRA account this year. I thought it might be a good move since Exxon is a stable company and the dividends would not be taxed in my Roth account. Would this be a wise thing to do or foolish?

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I think XOM is a great buy and hold stock for every type of investment account. I also started this thread bc I thought I was getting a steal when buying XOM at $20 more/share than it is today. So you can take my investing advice at your own peril

Thanks everyone!

Drifter. said:

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I thought it might be a good move since Exxon is a stable company

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A presumptive belief by many... Stock lost 63% in last 12 months. XOM may pay off, but that is not the description of a stable company.

Stable company vs stable stock are two different things, and the one does not always lead to the other.

Yep. No longer stable.

Personally I like RDS/B more than XOM right now and for the future

CaptnCarl said:

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I think it's a great idea. Supposedly the tax advantaged accounts like the Roth IRA are you hold your riskier investments. This would could as high risk.

If the roth is your only savings/investment accounts, I would do like 60% ETF, then 40% the XOM.

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XOM is high risk??

RIG is at 1.19 right now and while not "low risk" it seems inevitable oil will get more expensive at some point in the next 5 years.

Mtn_Guide said:

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Where are you going to put your money? Oxy? You can put it in Amazon like everyone else, or Tesla with a PE 6x Ford and having never turned a profit.

Exxon has volatility but it is one of the two most stable companies in the sector. It's not going anywhere anytime soon.

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I think some people's definition of stable is it's big and it's been around a long time. Look at their stock over the past 10 years, even before this recent event. It's been in decline against a double digit market increase.

Add to that they had insufficient cash flow last year to support its dividend.

I think there is some serious delusion around here... There are so many other places to put your money.

Fwiw, the broad market apparently doesn't like it either. Market mechanics don't drive a stock down like XOM over past 10 years like this if people were buying it.

XOM may be a "stable company" .. but I do not view it as a good individual stock to buy.

nortex97 said:

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RIG is at 1.19 right now and while not "low risk" it seems inevitable oil will get more expensive at some point in the next 5 years.

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You absolutely have to factor in the bankruptcy risk on something like RIG.

How was it's decline compared to the sector?

Mtn_Guide said:

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How was it's decline compared to the sector?

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"The sector" is all over the place. This thread is about XOM being a no brainier gotta buy below $60. It's not about hey, let's discuss and compare various options within oil and gas.

However, there have plenty of opinions expressed here that even within the sector there are better options, including CVX and RDS. And I agree with that sentiment.

cjsag94 said:

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nortex97 said:

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RIG is at 1.19 right now and while not "low risk" it seems inevitable oil will get more expensive at some point in the next 5 years.

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You absolutely have to factor in the bankruptcy risk on something like RIG.

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I don't see any way they can service that debt without a re-org. Equity will be taken out.

I would consider having a Roth IRA in just one stock, no matter the stock, to be a high risk investment strategy.

cjsag94 said:

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Mtn_Guide said:

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How was it's decline compared to the sector?

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"The sector" is all over the place. This thread is about XOM being a no brainier gotta buy below $60. It's not about hey, let's discuss and compare various options within oil and gas.

However, there have plenty of opinions expressed here that even within the sector there are better options, including CVX and RDS. And I agree with that sentiment.

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I am truely curious as to why CVX gets such a better valuation compared to XOM. Both have great debt levels, both benefit from non oil and gas specific investing due to their inclusion in the biggest broad market index funds (as compared to RDS which isn't included in the SP500 anymore due to being a foreign company, among other reasons when investors have flocked to US markets.

But CVX, which is over weighted in upstream compared to XOM which is more balanced.

Is it that CVX has a higher chance of better returns when oil is high? Anybody know? I only see people saying CVX is better but not one reason as to why.

For clarification, I don't work for either company, and agree that CVX has outperformed XOM from stock price standpoint, just don't understand it.

I've been reinvesting dividends for the last 5 years. If history repeats itself XOM will wait til absolute bottom and scoop up the coolest technology or fields for rock bottom price and ride the next cycle.

Markets don't know how to value large oil and gas companies. Especially those with significant assets. All they can see is cash flow and quarterly ratios. Look at the COP/PSX split. Hell, look at COP's market cap and production post split. They've been liquidating the company and no one cares. Similar oddity with the supers headed to gas while the shale players chase oil (Chevron too, of course). No one trusts shale (for good reason) and can't value large players so it ends up an immediate cash flow game. Silly for long term investors but that's where we're at.

The next cycle is setting up current. You want to be long integrated companies with a portion of assets allocated to shale.

Chevron is benefiting from three things over Exxon. They've recently completed a capex spending cycle to improve their production, they can cover their dividend without financing it through debt, and they have a billion dollars of Anadarko's (Now Oxy's debt) money from calling off the merger. Chevron and Exxon stocks are probably equally reflective of their outlooks right now. A couple weeks ago CVX dipped to 56 and it was a screaming deal as it didn't reflect their position. Exxon's story doesn't have those three positives to create a rosier future value proposition.

Agree. Exxon is more dependent on oil and gas prices

one MEEN Ag said:

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Chevron is benefiting from three things over Exxon. They've recently completed a capex spending cycle to improve their production, they can cover their dividend without financing it through debt, and they have a billion dollars of Anadarko's (Now Oxy's debt) money from calling off the merger. Chevron and Exxon stocks are probably equally reflective of their outlooks right now. A couple weeks ago CVX dipped to 56 and it was a screaming deal as it didn't reflect their position. Exxon's story doesn't have those three positives to create a rosier future value proposition.

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https://www.barrons.com/articles/energy-companies-find-it-harder-to-cover-their-rich-dividends-51582755434

In this article, written before the drop, it says CVX needed $57 on oil to cover the dividend, and Exxon needed $87. Do these things take into account Downstream? Exxon is much higher exposed to downstream than CHevron, which in the past would kick butt when oil price drops. I did not know Exxon needed that high of a oil price point till you pointed it out, but seems to be an incomplete picture, and only looking at half the company. You can't compare an integrated oil company to an independent.

Also this would seem to indicate CVX is financing that dividend, just like everybody else.